TheStreet.com Ratings: Model ETF Portfolio
Our ratings model takes a cautious view of domestic stocks. While the market is still up over the 12 months ended Feb. 28, the momentum is slowing. February's losses erased all the gains made in January.
You can blame it on falling home prices. You can blame it on a former Federal Reserve chairman's media-magnified comments. Or you can blame it on speculation in either Chinese stocks or the Japanese yen. The results are the same. The U.S. stock market seems to be pausing but still retains some positive aspects.
Our theoretical $10,000 portfolio of 10 exchange-traded funds illustrates this. In the period from Feb. 6 through Feb. 28, the portfolio lost 2.65%, in line with the major large-cap benchmarks. During the same period, the Dow Jones Industrial Diamonds (DIA) dropped 2.98%, while the S&P 500 SPDR (SPY) (SPY) fell 2.73%.
Domestic utilities, European value and Pacific Ex-Japan held up the best amid February's selloff, while capital markets, REITs and emerging markets were hit the hardest.The positive highlight of the month was the ML Utilities HLDR (UTH). This ETF benefited from the news that private-equity investors were lining up for a $45 billion buyout of a core holding, Texas Utilities (TXU). On Feb. 26, the day the deal was announced, the fund gained 3%. It finished the period up 2.85%.
|February ETF Trends Portfolio
Utilities and international non-emerging markets limit losses during downdraft
|ETF||Ticker||Shares||Price as of 2/6/2007||Beginning Value ($)||Total Return for Period (%)||Ending Value ($)|
|IShares MSCI VLU IDX||EFV||14||73.63||1,030.82||-1.15%||1,018.97|
|IShares MCSI EAFE EX-JAP||EPP||7||129.46||906.22||-1.12%||896.07|
|KBW CAPITAL MARKETS||KCE||15||71.68||1,075.20||-7.31%||996.6|
|IShares S&P GL Telec||IXP||14||65.4||915.6||-1.24%||904.25|
|IShares DJ Energy SC||IYE||10||101.47||1,014.70||-2.82%||986.09|
|IShares MRGSR LGVLIX||JKF||12||85.08||1,020.96||-2.97%||990.64|
|IShares MRGN SM Core||JKJ||11||89.02||979.22||-2.30%||956.7|
|ML Utilities HLDR||UTH||7||132.09||924.63||2.85%||950.94|
|Vanguard Real Estate ETF||VNQ||12||85.48||1,025.76||-4.77%||976.83|
|Vanguard Emerg Mkt ETF||VWO||14||79.04||1,106.56||-4.40%||1,057.87|
|Benchmark total returns:|
|Russell 2000 (IWM)||80.44||-2.00%||78.83|
|Dow Jones 30 (DIA)||126.65||-2.98%||122.66|
|(1) Total Return includes both price appreciation and accrued dividends.|
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